Bogov: Investments have failed, GDP will increase by 2.3%


This year investments have failed, affecting the projection of growth of the gross domestic product to 2.3% in 2016, said Governor Dimitar Bogov, at the presentation of the October macroeconomic projections.

“All investments totally failed: public, private, foreign and domestic. The general ambience due to the political crisis was not the most suitable and it affected investor confidence. Increasing the level of investments is not what we expected in the April projection”, informed Bogov.

He added that there are still adverse risks to the economy, and they are related to the political crisis, but also with the outside environment.

“GDP growth in 2016 will be between primary and alternative scenario than the April projection. There are domestic political risks, and there is lower performance in investments, as opposed to solid achievements in private consumption and higher exports”, assessed Bogov.

The Governor of the National Bank hopes that after election the situation will stabilize especially on the domestic political scene , therefore development will accelerate and reach 3.5% in 2017 and 3.7% in 2018.

Deposits growth in 2016 will be slow and will be reduced to 2.6% due to a fallout from the shock in April and May, when the citizens withdrew a record 58.5 million euros (3.6 billion denars) from banks, where the National Bank had to intervene with 77 million euros in the market.

Regarding the announcement of the public debt, which amounts to 50.6% of the GDP, Bogov briefly commented that fiscal consolidation is required and the stabilization of the public debt.

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